Value Congruence of Employer
Professionals observe serious changes in the national labor market, which is called tight, such as increasing cost-cutting, restructuring and tougher performance measures. All these is drastically influenced by the United States’ economic prosperity tempo and a shift from manufacturing to service industries. In organizational environment we observe a strong differentiation between the leading and the led employees in total wages and other benefits rates, the value being measured far beyond monetary dimension.
On the one hand, the employees’ value rise depending on the individual skills as well as intellectual or other investment into the organization’s performance. “Without the best people, we know it is even harder to deliver the demanded outcomes,” laments Anne Riches in an article How Do You Attract and Retain the Best People? for the CEO Refresher web site. “Getting and keeping the best is becoming harder than ever. ” states she at a time.
On the other hand, “Employees don’t know how to value their contributions accurately… ” warns Baruch Lev, Professor of Accounting and Finance at New York University states (Webber, 2000), displaying the dangers of using an accounting system that “cannot capture the new economy, in which value is created by intangible assets. ” The disconnect, says Lev, affects more than just financial analysts and corporate financial officers: in an information-based economy, this has enormous implications for both companies and labor.
Proportionally to employees’ values rise also the employers’ costs on the said values. Such a descrepancy establish new challenges in the organizational balance, involving leaderdip and value congruence as the elements and factors of the system. Additionally, new factors including pressures from unions and tax advantages have stimulated expansion of the benefits portion of compensation (Milkovich & Newman, 1993) in comparison to monetary one. “It’s an employee’s market, – mentioned once Cynthia E.
Griffin in Entrepreneur, – which makes it more difficult to just say no to proposals for an increase in the minimum wage or requiring employers to provide health care for uninsured workers. ” To draw the correlation between employees’ values, employers’ costs and leadership through industries on the external and international levels we observe the empirical research on the items and practical models of value congruence and leadership, implemented in different organizations.